How long do you have to send an adverse action notice?

Timing of Adverse Action Notices

Adverse action notices must be sent within a specific timeframe after certain events occur. These events include:

• Receiving a completed credit application
• Receiving an incomplete credit application
• Taking adverse action on an existing account
• Making a counteroffer to the applicant

The specific timeframes for sending adverse action notices are as follows:

• For a completed credit application: The creditor must notify the applicant of adverse action within 30 days after receiving a complete credit application.
• For an incomplete credit application: The creditor must notify the applicant of adverse action within 30 days after receiving an incomplete credit application.
• For an existing account: If adverse action is taken on an existing account, the creditor must notify the applicant within 30 days after taking the adverse action.
• For a counteroffer: If the creditor makes a counteroffer to the applicant, the applicant has 90 days to accept or use the credit offered. If the applicant does not accept or use the credit within 90 days, the creditor must notify the applicant of adverse action.

Content of Adverse Action Notices

Adverse action notices must contain specific information. This information includes:

• The action taken by the creditor
• The name and address of the creditor
• A statement of the provisions of section 701(a) of the Act
• The name and address of the Federal agency that administers compliance with respect to the creditor
• Either a statement of specific reasons for the adverse action or a disclosure of the applicant’s right to request a statement of specific reasons within 30 days

Creditors must comply with these requirements to ensure that applicants are adequately informed of the reasons for any adverse action taken on their credit applications or existing accounts.

Sources

• Adverse Action Notice Requirements Under the ECOA and the FCRA
• Timing of an Adverse Action Notice: FCRA Compliance
• § 1002.9 Notifications

FAQs

How long do I have to send an adverse action notice?

You must send an adverse action notice within 30 days of taking adverse action on a credit application or existing account.

What information must be included in an adverse action notice?

An adverse action notice must include the following information:

• The action taken by the creditor
• The name and address of the creditor
• A statement of the provisions of section 701(a) of the Act
• The name and address of the Federal agency that administers compliance with respect to the creditor
• Either a statement of specific reasons for the adverse action or a disclosure of the applicant’s right to request a statement of specific reasons within 30 days

What is considered adverse action?

Adverse action includes any action that denies or limits access to credit, such as:

• Denying a credit application
• Reducing the credit limit on an existing account
• Closing an account
• Increasing the interest rate on an account

Who must receive an adverse action notice?

An adverse action notice must be sent to the applicant or account holder who was denied credit or had their credit limited.

What if I don’t receive an adverse action notice?

If you do not receive an adverse action notice within 30 days of taking adverse action, you can contact the creditor and request a copy of the notice.

Can I dispute an adverse action notice?

Yes, you can dispute an adverse action notice by contacting the creditor and providing evidence that the decision was based on inaccurate or incomplete information.

How long do I have to dispute an adverse action notice?

You have 60 days from the date you receive the adverse action notice to dispute it.